Judge Allows Auction Of Righthaven Copyright Assets

Righthaven, a firm that made a business out of suing bloggers for posting newspaper articles, could be finished once and for all.

On Monday, a federal judge in Nevada issued an order that will allow one of Righthaven’s former victims, Vietnam veteran Wayne Hoehn, to appoint a receiver to recoup his legal costs. The receiver will be empowered to hold an auction to sell off the copyrights that appear to be Righthaven’s only assets.

For those unfamiliar with Righthaven, the self-styled copyright enforcer created a stir in 2010 when it partnered with two western newspaper chains to sue people who posted news stories on their blogs. The firm was for a time earning hundreds of thousands of dollars through coercive settlement offers. But the wheels began to come off this year when a judge halted the lawsuits and one of Righthaven’s two partners walked away, denouncing the scheme as a “dumb idea.”

In the last two months, the company has been on the ropes as bloggers have counter-sued and won decisions saying they were protected by fair use and that Righthaven must pay penalties and attorneys’ fees. The most prominent of these has been the Hoehn case which has left the company scrambling to protect its assets before Hoehn’s lawyers can find and sell them.

The assets in question are the newspapers’ copyrights. Righthaven needs these if it has any hope of persuading an appeals court that it has fixed the original problem that led a court to halt the lawsuits in the first place. In a nutshell, that court said Righthaven couldn’t sue because it didn’t own the copyright and now Righthaven is telling the appeals court , “Wait, we do own the copyright now. Please confirm this so that we can continue our lawsuits and raise some money.”

The new order authorizing the auction means that Righthaven is in a damned-if-you-do, damned-if-you-don’t position. If it produces the copyrights, they will be sold and its case in the appeals court would fall apart. And if doesn’t, Righthaven’s lawyers will be in contempt of court and its appeals court case could likewise collapse.

In a related order on Monday, U.S. Magistrate Judge Robert Johnston ordered Righthaven’s lawyer and his wife to appear in court on January 5th to explain under oath where the assets are. If the couple doesn’t appear, the judge has authorized US Marshalls to hunt them down and bring them back.

Righthaven has so far seemed to have nine lives in the court system, meaning the company could limp on a bit further.

But if the copyright auction goes forward, it could provide the ironic spectacle of the newspaper owner, Stevens Media, bidding to buy back its own articles.

For more on the Righthaven saga, see Steve Green’s reporting in the Las Vegas Sun.